NAB wealth boss urges delay in super reforms

National Australia Bank
wealth management chief Steve Tucker has called on the government to delay crucial superannuation reforms, warning the industry was struggling to be ready in time for the changes.

“The challenge for super is that it is such a large pool of savings, it is like a honey pot," Mr Tucker said.

“It attracts everybody’s interest and particularly in challenging times like this, when you are trying to balance the budget, governments can’t help themselves to look in and see what they may be able to extract in terms of tax."

The government’s Stronger Super reforms are due to commence on July 1 and will require all super providers to offer a low-cost default alternative to investors as well as introduce a tougher regulatory regime for the industry.

With less than a year before the rules take effect, Mr Tucker said the wealth management sector was still waiting for the critical regulations detailing how the changes would work.

“The challenge is going to be that we still don’t have the final legislation and regulation and we have tight deadlines and we have a very big industry that has got a big job to do at the same time," he said.

“If you think about the resource challenge and all the systems we have to touch and deal with, it is going to be pretty hard work. The longer it takes to finalise the details, the more pressure we are under to get it right."

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Speaking at an American Chamber of Commerce in Australia lunch in Sydney on Tuesday, Mr Tucker said super funds wanted to invest more in infrastructure projects. However, he said, they were held back by problems with the present structure of public-private partnerships used to fund such developments.

“We need to have some constructive dialogue around the infrastructure space and work out what is the right balance between the risk of developing infrastructure that should be taken on by the government and what is the right balance for the investor," he said.

“Some of the public-private work that has gone on has not got that right, so we need to work together to make sure we get some of this big pool of superannuation money invested in infrastructure and nation building."

Mr Tucker said NAB saw growth opportunities in online trading, corporate super and funds management, for which it has explored offshore acquisitions. He said the bank would also increasingly look to Asia for growth.

He said missing out on acquiring AXA Asia Pacific, which was bought by AMP last year after NAB’s bid was blocked by the Australian Competition and Consumer Commission, was disappointing. “It was probably the last major asset with scale and capability and that has gone to a competitor."

He warned that the big danger for Australia was that “we have too many people retiring with not enough money".